This ASX tech company just surged past the $10 billion valuation mark after a major profit upgrade

Codan Ltd (ASX: CDA)’s value has surged past $10 billion, up more than 15% just today, after the company announced a large profit upgrade just three months into the new financial year.

Firing on all cylinders

The technology manufacturer has two main divisions – metal detection and military communications – with both expecting to grow significantly over the full year.

Codan had already issued a trading update on 20 August, saying strong demand for unmanned systems meant that its communications division expected to significantly exceed the previous year’s performance in the first half.

The company said on Tuesday that orders had continued to strengthen during the first quarter and it now had better visibility for results through the second quarter.

Codan said demand outside of conflict regions was strong, and revenue was expected to be up 20% on the previous corresponding period, “with broad-based growth across regions and markets reinforcing the global relevance of our technologies”.

The company added:

Demand from conflict regions is currently exceptionally strong, reflecting the proven performance and reliability of our technology in these contested environments. With this elevated demand, Codan expects revenue generated from conflict regions to represent approximately 50% of Communications segment revenue in H1 FY27 (vs. approximately 20% in the previous corresponding period). Codan now expects the Communications segment to deliver H1 FY27 revenue of between $400 million and $410 million. This compares to $221.8 million in the pcp and $506.2 million in full year FY26.  

The strong demand could also translate into a better EBIT margin of about 40% in the first half, compared to 26% in the first half last year.

Codan said demand from conflict regions was difficult to predict over the full year, “and accordingly it is too early in the financial year to determine if demand and margin will continue at similar levels in H2 FY27”.

Metal detection also performing well

The Minelab metal detection division was also performing strongly, driven by demand for the recently launched GPZ8000 and Gold Monster 2000 detectors, Codan said, as well as by the favourable gold price.

On August 20, Codan said that Minelab was tracking broadly in line with second-half FY26 levels.

Minelab’s revenue run rate is now slightly above those levels, Codan said.

In terms of group profit, Codan is expecting a net profit of not less than $160 million for the first half, compared to $71.2 million in the first half of FY26 and $175.2 million for the full year.

Codan shares traded as high as $61.30 before settling back to be 16.8% higher at $60.73.

The post This ASX tech company just surged past the $10 billion valuation mark after a major profit upgrade appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.